Committee green-lights lottery for online gaming

Posted
Friday, June 17, 2016 3:27 am

By Colin A. Young

STATE HOUSE NEWS SERVICE

BOSTON &GT;&GT; The Massachusetts Lottery would be authorized to offer its products online and on mobile applications, something the Lottery has said is essential to maintaining and growing its revenues, under a bill given approval this week by a legislative committee.

The Lottery has been looking for a "broad mandate" from the Legislature to move online, saying that an internet presence will be essential if it is to continue to thrive and return hundreds of millions of dollars to cities and towns as online games attract young players and their money.

The Joint Committee on Consumer Protection and Professional Licensure gave a favorable report Wednesday to an amended version of a Sen. Jennifer Flanagan bill (S 151) that would allow the Lottery to "conduct a state lottery, including a lottery or lotteries conducted online, over the internet, or through the use of mobile applications."

"Since millennials and other younger players have grown up with access to technology at their fingertips, they are less likely to purchase lottery tickets in the traditional marketplace and we need to find an alternative way to engage them," committee co-chair Sen. Barbara L'Italien said in a statement. "Massachusetts is highly reliant on lottery revenues for local aid, and in order to sustain the high revenues to which we are accustomed, we need to diversify our offerings to engage younger players and continue to have one of the strongest lotteries in the state."

Convenience store owners, who rely on the Lottery to attract foot traffic to their stores, have strongly opposed a Lottery move to the internet. But five years after lawmakers authorized casino gambling, Lottery officials and lawmakers appear to be giving strong consideration to another form of gambling expansion to keep state revenues flowing.

In addition to requirements that the Lottery verify all online players are at least 18 years old and in Massachusetts at the time of purchase, the committee attached eight conditions to the Lottery's online shift.

Any winnings between $200 and $599 would have to be claimed by the winner in person at a Lottery retailer, and winnings of $600 or more would have to be claimed in person at the Lottery's office. The committee also gives the Lottery the ability to withhold payout until it has determined the winner does not have outstanding child or spousal support payments or other state debt.

The committee's amended version of the bill also calls for daily, weekly and monthly maximum limits on how much players could deposit online for Lottery products, and requires that players have the ability to lower those limits themselves. It also would require players to be able to withdraw any and all winnings at any time and bar deposits directly from a bank account to an online Lottery account.

The Consumer Protection Committee's bill would keep Lottery retailers in the fold by allowing players to purchase from retailers an "online game card" that could be used to add funds to an online Lottery account. The bill would not authorize the use of credit or debit cards to purchase Lottery tickets at physical retailers.

The Lottery has already begun to study some of the possibilities the internet could hold. In December, the Massachusetts Lottery Commission issued a request for information, inviting organizations to submit proposals for development, implementation, operational support and maintenance of an online lottery system.

That RFI -- which garnered 20 responses -- asked for proposals for "the development and integration of digital versions of existing and new lottery games ('iLottery Games'), including but not limited to social gaming and daily fantasy sports options."

Treasurer Deborah Goldberg late last year cautioned lawmakers that the recent string of record-level Lottery sales will not continue unless the Lottery adapts to compete with the state's growing casino gaming industry and daily fantasy sports contests.

Goldberg has touted the idea of a Lottery-run fantasy sports game, which she said would attract a younger audience that favors playing on mobile devices, particularly 25-to-45-year-old males "who are not Lottery players (and) who are extremely excited by sports-related fantasies."

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